The hope was that postponing the most contentious issues until last would gradually build trust between the two sides as they moved the Israeli Army out of areas in the West Bank and Gaza Strip and empowered Palestinians to govern these areas.

The reality check is that it left many crucial and emotional issues unsolved for six years.

Now the hard part begins. These ill-defined and untouchable concepts that have been around since Israel and the Palestinians signed a peace deal in 1993 must now be resolved.

On Nov. 8, negotiators started talks on the six categories of final-status issues delineated in earlier peace agreements: Jerusalem, refugees, settlements, security arrangements, borders, relations and other issues of common interest, such as water resources. Here is a brief look at the problems the two sides have pledged to reach an ambitious framework agreement on during the next 100 days.

JERUSALEM

Both peoples claim Jerusalem as their political, religious, and historic capital. The western part of Jerusalem has been Israel's capital since the Jewish state's founding in 1948. In the 1967 Mideast war, Israel captured East Jerusalem.

Palestinian leader Yasser Arafat promises his supporters that he will establish a state with Jerusalem as its capital. Palestinians say they must have all the land in East Jerusalem that Israel seized in 1967 - including the walled old city that contains shrines holy to Christians, Jews, and Muslims. Israeli Prime Minister Ehud Barak says he will not divide Jerusalem, but his Labor Party in the past has suggested that Israel could relinquish some Arab neighborhoods in East Jerusalem for a Palestinian capital.

Palestinians say that all those who either fled or were forced out of their homes during the 1948 and 1967 wars - and their descendants - should be allowed the "right of return." That number, according to the United Nations, stands at about 3.6 million refugees in the West Bank and Gaza, Jordan, Lebanon, and Syria. Palestinian officials say the total is more like 5 million. Israel's position has been that Palestinian refugees cannot be allowed to return and should be settled in the surrounding Arab countries to which they fled. It appears likely that negotiators will agree on a compromise formula that would allow some refugees to move to a to-be-established Palestinian state while others are given financial compensation.

BORDERS &amp; SECURITY

Borders and security go to the heart of the question of what kind of Palestinian state - or "entity," as Israeli officials prefer to call it - will be established. Palestinians say that the pre-1967 lines that separated Israel from the Jordanian-controlled West Bank and Israel from Egyptian-ruled Gaza should serve as Palestinian state borders. But Barak says he will not agree to return to the 1967 borders because of security concerns.

Instead, Israel has suggested it is prepared to give over control of the bulk of the West Bank to Palestinians, but must maintain control over the Jordan Valley and maintain a protective presence on the West Bank hills that overlook Israel's coastal cities. Palestinians say that as an independent state, they should have the right to build a national defense force and control their own border crossings. Israel says that the Palestinian state must be demilitarized and share the work of monitoring international entry points with Israeli security forces.

Barak has said that he supports "separation" as a means to reduce friction between the two peoples. But Palestinians argue there should be open borders so Palestinian laborers can continue to work in Israel and contribute needed income to Gaza and the West Bank.

SETTLEMENTS

Since taking over the West Bank and Gaza Strip in 1967, Israel has built - in defiance of international law - 144 settlements that are now home to about 170,000 Jews. The Palestinian position is that all settlements are illegal and must be evacuated by Israel. Mr. Barak has suggested that he wants to annex most of the larger settlements to Israel in blocs, while agreeing to dismantle some of the smaller, more remote settlements. Palestinians view the settlements as impediments to creating a united piece of autonomous territory in the West Bank, and worry that the settlements' survival will ensure the presence of the Israeli army. Israelis want to keep the settlements for religious and security concerns.

RELATIONS &amp; COOPERATION

A number of problems cross international boundaries, especially the distribution of water resources, as well as other ecological and economic issues.

In previous negotiations, Israel recognized that Palestinians have water rights in the West Bank and Gaza. but it is concerned that overpumping could damage the water table for both peoples. Israel wants the Palestinians to consult and cooperate on all water-usage plans, ultimately allowing Israel to maintain control. Palestinians complain that they have to ask Israel for permission every time they want to drill a new well, and that Palestinians suffer from water shortages that Israelis do not have. The Palestinians say they must be given full control of water resources in areas under their jurisdiction.

Many of these issues naturally overlap. It will be difficult to solve the conflict over Jerusalem without simultaneously agreeing on borders between the Israeli and Palestinian states. Moreover, many here suggest that the official final-status talks are not the forum where much of the real deal-making will take place. Barak, experts say, wants to use quiet back channels that often have proved the most effective for producing peace deals in the past.

"The problem with the formal negotiating panels is that people are working on very specific issues, and that makes it a zero-sum game," says Mark Heller at Tel Aviv University. "That is why high-level talks are promising. Rather than worrying about concessions on water, they'll say, 'If I give on water, I can get on refugees.' "

But Palestinians are concerned about reports that Barak may ask the parties to "agree to disagree" on issues where the two cannot reach a consensus - indefinitely postponing a solution, for example, on refugees.

"We understand that we have difficult negotiations to be completed in 100 days, but I don't think that the Palestinians will waive any of these issues just to meet the deadline," says Marwan Kanafani, a Palestinian Legislative Council member.